Posted on 01/20/2016 7:17:05 AM PST by newgeezer
The Republican presidential frontrunner's vow to get Apple to "build their damn computers and things in this country" would lead to unrealistically high costs for you.
____________
Donald Trump's plan to "make America great again" may include getting you to fork over a whole lot more money for your next iPhone.
After all, that would be the logical progression from the Republican presidential frontrunner's latest bold (crazy?) promise: Getting Apple to start manufacturing its products in the US instead of China.
"We're going to get Apple to build their damn computers and things in this country instead of in other countries," Trump said in a speech on Monday at Liberty University in Virginia.
Trump's rhetoric is designed to appeal to a base of voters who are struggling to find jobs in the US. Apple, the world's most valuable company with a market capitalization of $534 billion, designs its best-selling iPhone, iPad tablets and Mac computers in the US but relies on partners in China and Chinese factory workers to assemble almost all of them (one model of the Mac is made in the US). But how much would it cost to build those "damn things" in the US? Even a rough calculation of the basic costs shows it's an unfeasible option, leading to an iPhone with a potentially jaw-dropping price tag.
To keep things simple, let's just look at the wages of workers tasked with assembling an iPhone. A worker at Chinese manufacturing giant Foxconn gets paid roughly $400 a month before overtime, according to the New York Times.
Now assume Apple goes the economic route and places a manufacturing plant in Wyoming or Georgia, which happen to have the country's lowest minimum wage at $5.15 an hour. Working eight hours a day, five days a week, a US worker would make $824 a month, or more than double the Chinese worker. If Apple were to employ someone in its home state of California, where the minimum wage is $9 an hour, the monthly pay is $1,400, or more than triple the Foxconn worker.
Assume you have a pool of workers skilled enough to handle the task (you don't) and then assume those workers will work for minimum wage (they won't). After awhile, things don't add up.
While there are a number of other factors that go into an iPhone, including the components, shipping, marketing and research and development, doubling the labor costs could significantly hike up the price of an iPhone. The starting price of Apple's marquee iPhone 6S is $650 -- would you be willing to pay for the phone if it was $1,300? Or more?
"Twice as much is conservative," Carolina Milanesi, an analyst at Kantar Worldpanel, said about the price hike of an iPhone if it were manufactured in the US.
At another point, Trump proposed a 35 percent tax on products built outside of the US. So at a minimum, that would mean your next iPhone could start at $877.50.
Apple declined to comment on Trump's comments and didn't want to get into the potential math of bringing phone manufacturing back to the US.
Trump's comments ignore the fact that Apple did invest $100 million to manufacture the Mac Pro in the US. It also buys some of its components from US companies, including Intel's chip for its Mac computers. The company said earlier this month that it believes it has created 1.9 million jobs in the US through the creation of the app economy around the iPhone and its other products.
Even Apple, with its $200 billion-plus stockpile of cash, couldn't afford to build a phone in the US at a reasonable price. Making a more expensive, "Made in the USA" product isn't an option, especially as consumers start to wise up about how much they're spending on their phones. Every day, decent, low-cost alternative phones are cropping up.
So chalk it up to another wild, impossible-to-deliver-upon claim by Trump. But that's part of his appeal, right?
Think of how much this article costs you in EITC for those that might work a little or transfer payments to those that don’t work at all ? Think of the work of statan done by all those idol hands and what that costs you? Don’t you think those numbers dwarf the iphone savings? Think about how China got from unable to feed its people to where it is now? Think of how the US got from colossus to feeble. Stop the insanity. Stop it now. The smarty pants free trade absolutism is the road to ruin. Were halfway there.
A passenger car takes about 30 man hours ( industry standard) to build so my estimate it takes 1 man hour in total to build/assemble an iphone. So the phone made in the USA would be about $50.00 more per phone.
I think the iPhone is already insanely priced, and for most people, it’s not something you have to buy all the time.
And the corporate taxes.
Easy, eliminate regulations and cut subsidies for offshoring.
China and India lobby Congress for laws friendly to offshoring.
We badly need to ban congressmen from owning foreign stock.
I like pie. The in the sky kind is the best.
It's not that we are too stupid to “build” (assemble) phones in the US, but rather that it requires semi-skilled labor that we are either unable (because of minimum-wage laws) or unwilling (because leisure or government benefits are valued too highly) to supply at a wage commensurate with its value to the employer.
Bingo! As far as labor goes, it’s also the healthcare, etc. And if labor unions get involved demanding higher wages than The skills are worth along with big retirements, that can be a problem.
“I just cannot wait to see how trump forces Apple to do this.”
Beware of the headline. I’ve seen a dozen headlines with words like make and force in them. The actual quote:
“We’re going to get Apple to build their damn computers and things in this country”
That’s slightly different....no ‘forcing’. And who knows, maybe Apple would come to the conclusion that building computers in this country is better, if the US no longer allowed China to manipulate its currency.
“Donald Trump attacked the law that bans American companies bribing foreign officials...”
http://www.newsmax.com/t/newsmax/article/439104
Well actually through regulations they do hand out a lot of orders.
Apple products have been and are expensive. LG makes a good product for about a third of the price.
“It’s actually blackmail, either we pay more for a product or we give our money, jobs, and economy to China.”
Except nearly everyone in America buys smartphones, so they benefit from the lower prices, while moving production over here would only create jobs for, and benefit, a very few of us.
“Prices would even out, would have to if Apple wants to stay in business.”
That’s some mystical thinking right there. For prices to even out, something would have to give. They could turn out a lower quality product, but then they would lose market share. Perhaps they could beg President Trump for government subsidies, and just pass along the higher costs to consumers through hidden taxes.
Foxcon had moved small unit to Fremont, CA. It will force Apple to bring back manufacturing to US.
Texas Instrument moved back to US.
Foxcon had lot of problem, inplace of moving to Vietnam, they will move to US.
Apple moving here would create jobs but also would add revenue to U.S. Apple would pay taxes here on their plants, employees would spend their income here, the money would be spread in U.S. instead of foreign countries.
It isn’t better for America to let other countries underbid our industry and pull our manufacturing into their borders. We’ve been duped when it comes to trade.
They're already overly expensive.
WHY do you think Apple has so much cash on hand?
Low priced Chinese labor.. very high product profit and no significant import taxes.
The paradigm can be subtlety shifted in the direction of benefiting America and its workers.. NOT just Apple and China.
Wait, so slave/child labor is a good thing?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.